Posts by Rod David
Post-open review
About last night…
The pre-open recovery to attack yesterday”s 2079.50 post-close high was retraced up to 2077.75. Its pre-open dip touched 2070.75, which had been identified already as the preliminary limit to at least make a bias-up likely.
Firming into the open then spent the first 15 minutes of volatility overlapping the 2074.00 bias-up target. That finally resolved up until piercing the overnight high up to 2080.00.
This is a renewed bias-up environment. Its minimum renewed target has been met. It just reacted down to attack 2074.00 and to pierce the opening range”s congestion.
Did I mention it”s still a bias-up environment? The dip back into the open”s range probably isn”t reversing the rally, but correcting it. Back under 2075.25 would signal at least a deeper correction targeting 2072.25. Otherwise, extending back above 2077.00 (being tested now) would be likely to resume the rally, especially if maintained at a steep pace.
Yesterday”s post-close surge was reversed
Yesterday”s post-close surge was reversed back into negative territory overnight. And then it was recovered almost entirely. Now the open is indicated to gap up to this morning”s bias-up target, which the pre-open Market Tour discussed here:
https://roddavid10.mitel-nhwc.com/join/rkrcsrf
The First Trade.
Proper context can start the day with a solid win and make all the difference.
Enter the Chartroom here (pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Wednesday”s choppiness still managed to include an afternoon rally from 2053.25 up to 2069.75. The overall effort was very disjointed, first creating “unfinished business below” at its oversold RSIs, and ultimately neutralizing unfinished business above at the morning”s bias-up signal. The singular probe above Friday high was not complex before reacting down to 2061.00.
Overnight action”s new info…
Firming into and out of Wednesday”s futures close was apparently caused by rumors from the Eurogroup meeting of agreement to kick the can further down the road. Within minutes, it was touching 2079.50. Greece soon walked that back, and eventually negative territory was probed down to 2058.50. Having been corrected, firming again into Europe”s opens soon resumed rallying, so far reaching 2077.75.
If, then…
Yesterday”s close barely managed to form a hold-short whose bounce limit was exceeded a minute too late to disqualify the setup. Its maximum stop was triggered moments later, illustrating why the setup is not appropriate for any illiquid cash instrument. The setup illustrated something else, too — context. Greeting the news from the hold-short”s position of weakness made the knee-jerk reaction suspicious. The question now is whether already having reversed it all overnight, having probed back under the setup”s original low, allows the overnight rally to extend higher intraday uninterrupted.Other than stopping short of touching Wednesday afternoon”s oversold RSIs, the bullish template”s pattern and timing is playing out. Even the overnight selling”s measurements fit, albeit from a much higher level that avoided touching yesterday afternoon”s low.
First Trade…
Exiting the open at 9:45 above 2078.00 would be likely also to exceed the 2074.00 bias-up target through 10:15, which would renew the bias-up signal. Exiting the open under 2070.75 would be unlikely to exceed the bias-up target in time to renew the signal. But the open must be exited under 2065.50 before suggesting the 2067.75 bias-up signal won”t even trigger.
The hold-short setup at Wednesday”s
The hold-short setup at Wednesday”s close was already on life support when we discussed it at the start of the post-close Market Wrap. Now it”s already testing its maximum bounce limit. A quick drop at the Globex open may be the only bearish setup.
https://roddavid10.mitel-nhwc.com/join/wzchrxk
Morning bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2072.75 | 2067.75 |
| …would target | 2079.00 | 2074.00 |
| Bias-down: under | 2060.00 | 2055.00 |
| …would target | 2054.75 | 2049.75 |
| Signal status: BIAS-UP, EXCEEDED BIAS-UP | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 10:15, trading above the bias-up signal or under the bias-down signal would put into play a test of its bias-up or bias-down target.
2. Not triggering either bias signal at 10:15 would be “no-bias,” and the bias signals should define the bias environment”s range.
— A test of the opposite bias signal would be targeted if one bias signal was tested before triggering no-bias.
3. Touching the bias signal within 3 minutes either way of 10:15 would invoke a grace period through 10:30 to trigger a late signal.
— “Late” signals don”t require testing the opposite bias signal, but it”s still likely.
4. Still testing the bias signal at 10:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.